CFTC blocks political election ‘gaming’

Betting on the presidential elections isn’t going to be easier now that the nation’s commodities regulator has stepped in.

The Commodity Futures Trading Commission late Monday blocked the North America Derivatives Exchange, or Nadex, from an application they had submitted for listing political event derivatives contracts. Based on their application, participants could have betted on who would win the presidency or control the House or Senate in elections this November.

“The CFTC determined that the contracts involve gaming and are contrary to the public interest, and cannot be listed or made available for clearing or trading,” the agency said.

Nevertheless, regulators have permitted other trading sites. Ireland-based Intrade bills itself as a marketplace for the exchange of predictions on uncertain future events including elections. Former Massachusetts governor Mitt Romney has a 37.5% chance of becoming elected president, according to
Intrade. Check out Intrade here.

The University of Iowa also is allowed to host a small-scale electronic market where participants can bet on elections, The University says the exchange is set up for research purposes and participants can open an account with between $5 and $500.